The Effect of Marketing Challenges on the Performance of Small and Medium Scale Enterprises: (A Case of Loka Abaya Woreda, Sidama Zone, SNNPRS, Ethiopia)

Mathewos Yure Dangisso

doi:10.7176/jmcr/55-05

Abstract

Small and medium enterprises played a great role for economic development and employment creation. The purpose of this study is to assess the effect of marketing challenges on the performance of SMEs a case of Loka Abaya woreda. Primary data was collected through structured questionnaires from 220 respondents. SMEs Operators and managers’ were selected by stratified random sampling techniques. Interviews were also conducted with stake holders of woreda government bodies and managers. Qualitative and quantitative research approaches were employed. In this study Descriptive research were used to analyze the research data. Descriptive statistics such as percentage, mean, and standard deviation is used, while inferential statistics were used such as Pearson correlation, and multiple regressions analysis.It was found out that (R 2 =0.805) implied that independent factors: production & selling place, marketing factor, promotion, distribution channels and pricing, predicted (80.5%). The dependent variable performance of SMEs predicted by the rest 19.5 % accounted by other factors. The findings of the study also revealed that marketing factors has a higher effect on the performance of SMEs followed by pricing challenges. Therefore, SMEs in the woreda, Sidama zone responsible bodies, Loka Abaya woreda responsible bodies and the government can take appropriate measures to solve the problems related to independent factors in this study to improve SMEs performance. Keywords: SMEs, marketing challenges, SME performance, Loka Abaya woreda. DOI : 10.7176/JMCR/55-05 Publication date : April 30 th 2019

Highlights

The micro and small business sector is recognized as an integral component of economic development and a crucial element in the effort to lift countries out of poverty (Wolfenson, 2007)
AND DISCUSSIONS This study conducted two hundred twenty (220) questionnaires were distributed across the five sectors(construction, manufacturing, service, trade and urban agriculture) in Loka Abaya Woreda Small and medium sized enterprises (SMEs), all questionnaires (220) were completed and retrieved successfully, this was done by enumerators, it represented 100% return rate
For every one unit increment on marketing factors the performance of SMEs increases by 46.5% For every one unit increment on promotion the performance of SMEs increases by 13.5% For every one unit increment on distribution channels the performance of SMEs increases by 12.5% For every one unit increment on pricing the performance of SMEs increases by 22.5% Predicted performance score = -.327+0.137 + 0.465 + 0.135 + 0.125 + 0.225(pricing) Table 4.14 further showed that, all the explanatory variables included in this study can significantly explained at 95% confidence level (p

Summary

Introduction

The micro and small business sector is recognized as an integral component of economic development and a crucial element in the effort to lift countries out of poverty (Wolfenson, 2007). Different economists and scholars state a number of multi-dimensional reasons for the presence of developing countries level. Lack of sufficient capital and investment is expected to be among the major tangible reasons for underdeveloped economic status of these countries (Todaro, 2003). The dynamic role of micro and small enterprises (MSEs) in developing countries as engines through which the growth objectives of developing countries can be achieved has long been recognized. It is estimated that SMEs employ 22% of the adult population in developing countries (Fisseha, 2006). Lara and Simeon (2009) found out that SMEs sector generates substantial employment and economic output in many countries

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